Breaking News

Why Chinese $328 million loan could get Nigeria in trouble

China loaned Nigeria $328 million to boost telecoms

: President of the Federal Republic of Nigeria, Muhammadu Buhari (L) and Chinese President, Xi Jinping shake hands during a signing ceremony at the Great Hall of the People in Beijing, April 12, 2016.

China's Exim bank will lend Nigeria $328 million toward improving the west African country's telecoms infrastructure, Nigeria's presidency said on Saturday, at the start of a six-day visit by President Muhammadu Buhari to the country.

Why Chinese $328 million loan could get Nigeria in trouble

Poor telecoms are a major challenge for businesses operating in Nigeria, which is Africa's largest oil producer, most populous country and has one of the continent's largest economies.

The agreement, the latest in a number of Chinese loan facilities to Nigeria since Buhari took office in 2015, comes as Beijing seeks to deepen its ties in Africa.

Nigeria's presidency, in an emailed statement, described the loan as between Nigeria's Galaxy Backbone and China's Huawei Technologies .

It said the agreement was part of "the current administration's commitment to incorporating the development of information and communications technology into national strategic planning".

Buhari's administration has said it wants to improve the country's technology infrastructure to boost growth and create jobs as it seeks to reduce reliance on oil sales, which make up around two thirds of government revenues.